AgWeb.com Farm Journal Legacy Project Top Producer Dairy Today Beef Today Pro Farmer Ag Day TV US Farm Report AgriTalk Cattle-Exchange.com Farm Journal Media Ultimate Farm Quest Corn College Marketing Rally Farmers Feeding the World Farmers Feeding the World - test Outdoors on the Farm Baxter Black Machinery Minute Consumer Ag Connection Radio AgWeb Radio Tractor Tales PFA Pioneer Blog TPEN
May 25, 2013
Home| Tools| Blogs| Discussions| Sign UpLogin

 


MGEX Research

RSS By: Joe Victor, AgWeb.com

Joe Victor is a Business Development Specialist with Minneapolis Grain Exchange, Inc., where he monitors cash grain activity and cash grain opportunities. He provides marketing advice through this blog.

Soybeans Trading Lower due to Beneficial Brazil Weather

Dec 18, 2012

Hard Red Spring Wheat is trading higher at 11:02 a.m. central time. The outside markets have a lower US Dollar Index and gold futures with the Dow Jones Industrial Average and crude oil futures higher.

  • Fundamentally the United Kingdom imported twice as much wheat than they exported in the month of October according to sources. The United Kingdom had low yields and low quality for their 2012 wheat harvest. In all of North America Spring wheat has the highest amount of protein of all the wheats.
  • Technically support is 8944 with resistance of 9180. (March futures)
  • The Hard Red Spring Wheat spot index price is 843.32

 

Hard Red Winter Wheat is trading higher. The NWS 6-10 day has moisture for northern KS and two week forecast estimates above normal precipitation for the Southern Plains.

  • Fundamentally sources suggest the spread between the May and March HRWW futures continues to widen suggesting it pays to store the wheat during what is expected to reduced demand.
  • Technical support is 8340 with resistance of 8674 (March futures)
  • Hard Red Winter Wheat spot index price is 807.83

 

Soft Red Winter Wheat is trading higher. The overnight Paris Milling wheat futures most actively traded month are presently 2 Euro lower versus the settlement the day before.

  • Fundamentally sources suggest the spread between the May and March futures suggest it pays to store the SRWW during what is suggested slack demand.
  • Technical support is 8014 while resistance of 8254. (March futures)
  • Soft Red Winter Wheat spot index price is 773.51
     

Corn futures are trading lower. Private meteorologist suggest the two week weather forecast is mainly good for crops other than too much moisture for Rio Grande do Sul.

  • Fundamentally private meteorologist suggest moisture is good for corn growing regions in Argentina. The soybean cancelation described below may have a drag impact on the corn futures. Sources suggest the demand for US corn is not healthy.
  • Technical support is 7142 with resistance of 7346. (March futures)
  • The Corn spot index price is 715.55
     

Soybeans futures are trading lower. Weather in Brazil is expected to be beneficial according to private weather analysis for the next two weeks. These same private forecasters suggest southern Brazil is likely to experience localized flooding especially in Rio Grande do Sul.

  • Fundamentally Malaysian Palm oil futures were down 9 points. China Dalian Exchange indicates lower future prices for soybeans and soybean meal with higher soybean oil. China did cancel 300 K tonnes of US soybeans with an unknown destination canceling 120 K tonnes according to USDA.USDA did report the overnight purchase of 110 K tonnes of US soybeans for an unknown destination.
  • Technical support is 14530 with resistance of 14982. (January futures)
  • The Soybean spot index price is 1469.77
Comments (0)

Spring Wheat Planting, Emergence and Yield

May 11, 2012

The National Agriculture Statistics Services releases a "Crop Progress" report each week from planting to harvest season. Currently we are in week 18 of the season. This week the report includes planting progress and emergence reports.  
           
The question this year is how a fast planting pace may influence the final bushel per acre (bpa) yield.
 
5812
The chart shows information dating back to 1981. Only one other year, 1988, has experienced a faster planting pace than we are currently experiencing. Also in 1988, the percent emergence in week 18 was the same as it is today. Since 1981, the lowest yield occurred in 1988 with a harvest of
19.5 bpa.
            As of week 18, emergence is at 47 percent. The only year with a higher emergence percentage was 1996 with 56 percent emergence and a yield of 35.1 bpa.
            As the chart indicates, 2012 has been a good year for planting and emergence. However, historical trends show this does not indicate there will be a high final bpa yield.
            A linear trend line on the chart shows the trend yield has increased despite good or bad planting and emergence pace In1981 yield was 30.6 bushels per acre. Since then, we have experienced the lowest bpa in 1988 with 19.5 bpa, and the highest of 46.1 bpa in 2010. Of the 30 years of data shown on the chart, the average, yearly bpa increase is .149.
            It is important to remember that a good planting and emergence rate in 2012 does not automatically suggest a high bpa yield for the year.
 MGEX welcomes your questions.........Joe Victor
800.827.4746
 Information used to compile this update is from publicly available sources. Nothing contained herein should be construed as a trading recommendation of MGEX, its employee or its members. For informational purposes only.
 

Comments (0)

Spring Wheat Plantings

Apr 18, 2012

 

Each year USDA releases Prospective Plantings for the major crops in the U.S. at the end of March and Planted Acres at the end of June.Acres
Between 2002 and 2011, USDA has decreased spring wheat plantings by an average of 2.49 percent from the March report to the June report. In the past10 years, spring wheat plantings have increased in the June report from the March report four times. The most recent increase occurred in 2009 when USDA’s June acreage report was 3.76 percent over the March report. That year September futures increased three quarters of a cent per bushel. In 2011, spring wheat acres decreased by 5.56 percent while September futures decreased $1.4075 per bushel.
Since 2002, the largest June decrease from the March USDA report is 5.56 percent in 2011. The largest increase was recorded in 2002 when September futures rose 13 ¼ cents per bushel while the March to June increase was 5.30 percent in 2002.
Current prices for Hard Red Spring Wheat September futures are $8.05 per bushel, with a North Dakota grain elevator bidding new crop delivered cash wheat at $7.47 per bushel. This cash wheat bid suggests a farmer would need 5 cents per bushel per month, or 15 cents, to store the new crop spring wheat from September futures to December and to roll the hedged position.
The spread between the September and December futures is 4.5 cents per bushel inverted where the September futures are higher than the December futures. This suggests the spread will require a move of 21 cents for the farmer to roll the futures from September to December and consider storing the spring wheat crop.
The current spread between September and December futures suggests the world market end user prefers to buy the spring wheat as soon as it becomes available while projected supply is insufficient to meet demand.
 As long as the hedge from the long or short side is profitable for your business you don’t have to be concerned the price movement in the futures.
 
 

 MGEX welcomes your questions.........Joe Victor

800.827.4746
 Information used to compile this update is from publicly available sources. Nothing contained herein should be construed as a trading recommendation of MGEX, its employee or its members. For informational purposes only.


 

 

Comments (0)

Wheat Plantings

Mar 09, 2012

Since June 1, 2011 (the start of 2011-2012 market year) Hard Red Spring Wheat futures prices are down 18.2 percent, while Hard Red Winter is down 28.6 percent and Soft Red Winter down 29.8 percent. The losses in futures are a result of a larger supply brought in for Southern Hemisphere wheats during recent months and increasing world demand.
USDA released 2012 U.S. Winter Wheat Seedings on January 12. The report estimated 41.947 million acres, as compared with the January 2011 estimate of 40.99 million acres. The five-year average is 41.748.
USDA held its Outlook Forum February 23-24 and released 2012 all-wheat (winter and spring) acres at 58 million, as compared to 57 million acres the year prior.030912

USDA estimated 16.05 million acres spring wheat will be planted in 2012. This estimate last year was 16.01 million acres. Despite a USDA estimate at its 2011 Forum of 16.01 million acres to be planted, the persistent rains in Northern Plains at planting time led to only 84 percent of this estimate being planted.
The graph shows that since 2010, the USDA Winter Wheat Seedings and USDA Outlook Forum have estimated winter wheat acres to increase and spring wheat acres declining to leveling off.
 
There are two very important upcoming 2012 acres reports: the March 30 prospective plantings and planted acreage report released at the end of June. MGEX will hold a Crop Report Conference Call for each report. Visit www.mgex.com for more information.
Economics and nature will determine how many U.S. wheat acres will be planted and ultimately harvested. It must be mentioned MGEX will present an educational webinar for Spring Wheat on March 29th at 2 p.m. and again on April 4th at 2 p.m. 
 
It is important to use the appropriate risk management tool for the appropriate wheat.
 
 MGEX welcomes your questions.........Joe Victor
800.827.4746
 Information used to compile this update is from publicly available sources. Nothing contained herein should be construed as a trading recommendation of MGEX, its employee or its members. For informational purposes only.

Comments (0)

Days of Supply for Wheat

Dec 15, 2011

USDA released supply and demand data for the classes of wheat in its World Supply Demand Estimates (WASDE) for the month of December 2011. Hard Red Spring Wheat (HRSW), with its high protein, is an excellent bread making class; Durum wheat is used primarily for pasta because it is the hardest of all wheat; Hard Red Winter Wheat (HRWW) has less protein than HRSW and used for "all wheat flour" and; Soft Red Winter Wheat (SRWW) is referred to as snack food wheat as it has no protein standard recognized.
 121411
The graph shows that since 2006-2007, the daily supply of Durum wheat has been less than 100. There continues to be much less of a cushion versus the opposite end of the wheat spectrum. SRWW has a 240 day supply.
 
HRSW has now incurred two straight years of declining days of supply and is now
estimated at 96.
 
Because of the ample supply, both the SRWW and HRWW have experienced two years of increases in the number of days.
 
From the producer to the end user, it remains very important to use MGEX Hard Red Spring Wheat futures and options for production and usage to hedge as it can reduce risk and maximize profit potential for Hard Red Spring and Durum wheat. Not all wheat classes are the same. It is important to use the appropriate tool for the appropriate wheat.
 
 
 MGEX welcomes your questions.........Joe Victor
800.827.4746
 Information used to compile this update is from publicly available sources. Nothing contained herein should be construed as a trading recommendation of MGEX, its employee or its members. For informational purposes only.
 

Comments (0)
Log In or Sign Up to comment

COMMENTS

Receive the latest news, information and commentary customized for you. Sign up to receive Top Producer's eNewsletter today!

Hot Links & Cool Tools

View More
 
 
 
 
AgWeb.com Farm Journal Legacy Project Top Producer Dairy Today Beef Today Pro Farmer Ag Day TV US Farm Report AgriTalk Cattle-Exchange.com Farm Journal Media Ultimate Farm Quest Corn College Marketing Rally Farmers Feeding the World Farmers Feeding the World - test Outdoors on the Farm Baxter Black Machinery Minute Consumer Ag Connection Radio AgWeb Radio Tractor Tales PFA Pioneer Blog TPEN
The Home Page of Agriculture
About Farm Journal Media|Careers|Contact Us|Advertise|Lite Version|RSS||Facebook|YouTube
© 2013 Farm Journal, Inc. All Rights Reserved|Web site design and development by AmericanEagle.com|Site Map|Privacy Policy|Terms & Conditions